Investors in the software company’s new funding round include T. Rowe Price and Nvidia
(Bloomberg) — Databricks Inc. has raised $500 million in new funding, a large deal that catapults the software maker’s valuation to $43 billion and highlights its focus on artificial intelligence tools.
The round was finalized after discussions last month, which were reported by Bloomberg. T. Rowe Price lead the financing, with participation from strategic investors Nvidia Corp. and Capital One Financial Corp.
“We’re very excited about this strategic partnership with Nvidia to build custom large language models,” said Databricks Chief Executive Officer Ali Ghodsi, referring to the systems that corporations are racing to deploy because they work with enormous data sets and understand human-phrased questions. “This investment lets us double down on our generative AI strategy.”
Databricks, which provides tools for data and analytics, has recently emphasized its artificial intelligence capabilities, including by building its own large language model, which companies can use to make their own ChatGPT-like programs.
Nvidia CEO Jensen Huang has made an effort to promote the use of artificial intelligence in new markets. The chipmaker is building systems and software to help new entrants and is investing in partnerships, which could help speed the uptake of new products.
Databricks’ latest funding round values each share at $73.50, the company said. That’s the same price as its last funding round two years ago, after adjusting for a stock split.
Databricks is often viewed as ripe for an initial public listing, but Ghodsi said he had no target date in mind, preferring to focus on growth, both organically and through acquisitions. The company also said it had closed its $1.3 billion acquisition of Mosaic ML, announced in June.
In a press release, Databricks said it was on track for $1.5 billion in annual revenue, and that sales were up about 50% from the previous year. The company has more than 10,000 customers, it said, including more than 300 on pace to spend upwards of $1 million annually.
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